FCC Gives Altrio the OVS Go-Ahead

Federal regulators last week approved Altrio Communications' request for an open video-system license to serve some 3 million Southern California households.

The Federal Communications Commission gave the latest entrant into the overbuild wars the nod to serve Los Angeles, Ventura and Orange County, Calif., areas controlled by some of the nation's largest MSOs.

"Obviously, we are not going to build out all three counties in the first phase of our business plan," Trainor said.

Theoretically, an OVS license permits Altrio to enter over 100 communities in the three counties without obtaining local franchises.

"But we'll do both, depending on the needs of the local jurisdiction," Trainor said. "We're shooting for the first quarter of 2001 for our first franchise."

Altrio has also filed copies of its OVS applications with local governments. None of those jurisdictions have filed an objection with the FCC, Trainor said.

Unlike other overbuilders, Altrio-headed by the former executive management team at InterMedia Partners-is solely targeting Southern California. It raised $125 million from a group of investors headed by Frontenac Co. and Bessemer Holdings, as well as Soros Private Equity Partners, SSB Capital Partners, Bank America Capital Investors and Grove Street Advisors. The group has also promised to provide additional funding.

Also, American Broadband told Buffalo, N.Y., regulators it needs another 60 days before it can officially start franchise negotiations, citing recent financial-market shifts.

The cost of the Buffalo overbuild is estimated at $125 million and company officials want all of their financing in place before they sit down with city officials.

American Broadband was the only company to respond to a request for proposals issued by Buffalo, which wants a competitor to Adelphia Communications Corp.

For its part, Adelphia is in talks to expand its redevelopment proposal for Buffalo's Inner Harbor. The multimillion-dollar project would create a home for Adelphia's operations, a training facility for the Adelphia-owned Buffalo Sabres National Hockey League team and retail and office space.